Motilal Oswal Financial Services (MOSL) has maintained a Buy rating on Laurus Labs, raising its target price to ₹970 from ₹860. The revised target suggests continued confidence in the company’s growth trajectory, supported by robust performance in the contract development and manufacturing organisation (CDMO) segment.
Laurus delivered its third consecutive earnings beat, with CDMO growth leading the charge. The contribution from the CDMO vertical has risen significantly, with gross margin guidance now upgraded to 55–60%, up from the previous 50–55% range. MOSL expects this segment to continue posting healthy year-on-year growth in FY26.
The antiretroviral (ARV) business also reported a solid 17% YoY growth, and the company maintained a stable sales outlook for FY26. Additionally, Laurus is expanding its manufacturing footprint, with a new Gene/ADC facility in Hyderabad and a microbial fermentation unit in Vizag currently under construction.
The company has outlined a ₹5,000 crore capital expenditure plan over the next five years and expects its net debt-to-EBITDA ratio to stay between 2.2x and 2.5x.
Reflecting the improved outlook, MOSL has raised its earnings estimates by 16% for FY26 and 7% for FY27.
Disclaimer: This article is based on Motilal Oswal’s brokerage report and does not constitute investment advice. Please consult a certified financial advisor before making any investment decisions.
